The misuse of the OBC Non-Creamy Layer Reservation provision (NCL) by Probationary Indian Administrative Service (IAS) officer Puja Khedkar coupled with multiple disabilities certificates has raised issues surrounding the creamy layer in OBC reservation.

About Reservation

• Reservation is a policy for ensuring Equality and Social Justice which aims to enable special provisions for the advancement of socially and educationally backward classes or OBC, Scheduled Castes (SC) and Scheduled Tribes (ST) in education and government jobs.

Constitutional Basis for Reservations in India

• Articles 15(4) and 16(4): They guarantee equality to all citizens in any policy of the government and public employment respectively.
  • Reservations for SC and ST are fixed at 15% and 7.5% respectively, in jobs, educational institutions and public sector undertakings (PSU) at the central level
  • OBC Reservation: It was introduced in 1990, by the then V. P. Singh government based on Mandal Commission (1980) recommendations.
    • A 27% reservation for OBC was implemented in central government employment 
  • 2005: Reservation was enabled for OBC, SC and ST in educational institutions including private institutions.
  • 103rd Constitution Amendment Act 2019: 10% reservation was enabled for the Economically Weaker Sections (EWS) among the General category.

Enroll now for UPSC Online Course

Other Backward Class and The Creamy Layer Concept

• About Other Backward Class: OBC is a collective term used to  denote castes that are educationally or socially backward.
• Occupational basis of Identification: The OBCs are generally identified on the basis of their occupation, 
  • Example: Cultivation of own land, tenant farming, pottery, agriculture labour, cultivation and selling of vegetables, fruits and flowers, oilseeds crushing, cattle-rearing, washing clothes, carpentry, blacksmith, stone-cutting, etc.
• Population Share: The Mandal Commission report of 1980 estimated OBCs population including  both Hindus and non-Hindus, at around 52 per cent of the total population and identified 3,743 castes and communities as OBCs.
  • As per National Sample Survey Organisation,  The OBCs population was at 41 per cent in 2006.
• Constitutional Safeguards: 
  • Article 15(4): It says nothing in this article shall prevent the State from making any special provision for the advancement of any socially and educationally backward classes of citizens.
  • Article 16(4): It allows the state to make any provision for the reservation of appointments or posts in favour of any backward class of citizens which, in the opinion of the State, is not adequately represented in the services under the State.
  • Article 340: it provides for the appointment of a Commission National Commission for Backward Classes to investigate the conditions of and the difficulties faced by the socially and educationally backward classes and to make appropriate recommendations. 
• OBC Reservation: It was introduced in 1990, by the then V. P. Singh government based on Second Backward Classes Commission (Mandal Commission) recommendations.
  • A 27% reservation for OBC was implemented in central government employment 
• Indra Sawhney case (1992): The 27% reservation for OBC was upheld by the Supreme Court with the opinion that ‘caste is a determinant of class in the Indian context’, but it was conditional and subject to the exclusion of the creamy layer.
  • A 50% cap was also fixed for reservation unless there are exceptional circumstances to uphold the basic structure of equality.

Creamy Layer Concept

• The Department of Personnel and Training (DoPT) has listed various categories of people of certain rank/status/income whose children cannot avail the benefit of OBC reservation.
• Recommendation: The Justice Ram Nandan Prasad Committee (1993) recommendation was taken into consideration for identifying a person as part of the creamy layer.
• Criterion:
  • Parental Income: It is determined by the position/income of an applicant’s parents alone.
    • Non Governmental: For those not in government, the current threshold is an income of Rs 8 lakh per year (excluding income from salary and agricultural income) in the last three consecutive financial years.
  • GroupA/B Government Service:
    • Either of the parents entered government service (centre or State) as Group A/Class I officer
    • Both the parents entered as Group B/Class II officers 
    • Father, who was recruited in Group B/Class II post and promoted to Group A/Class I before 40 years of age.
  • Either of the parents employed in a managerial position in PSUs
  • Either of the parents holding constitutional posts.
  • Children of a Colonel or higher-ranked officer in the Army, and children of officers of similar ranks in the Navy and Air Force.

Issues Pertaining to the Reservation System in India

• Circumventing the System: Dubious means are adopted by some candidates to obtain such Caste (NCL and EWS) and Disability (4% reservation) certificates to avail Reservation benefits,
  • Example: Strategies like gifting of assets, taking premature retirement etc are adopted to get around the creamy layer exclusion by applicants and their parents, since the applicant’s or his/her spouse’s income is not considered for such exclusion.
• Concentration of Reservation Benefits: As per the Rohini Commission (set up for providing recommendation on sub-categorisation among OBC castes) estimates 97% of reserved jobs and seats in educational institutions have been garnered by just around 25% of the OBC castes/sub-castes at the central level. 
  • Close to 1,000 of around 2,600 communities under the OBC category had zero representation in jobs and educational institutes.
• Creamy layer for SC/ST: Concentration of reservation benefits persists in the SC and ST category as well, which does not have any exclusion based or  ‘creamy layer’ criteria.
• Unfilled Vacancies: 40-50% of seats reserved for OBC, SC and ST in the central government remain unfilled as per government replies in Parliament.
• Reservation for Religious Minorities: Debate over reservations based solely on religion vs. reservations granted to socially/educationally backward groups within various religions.
  • Extending SC Reservation: Commission headed by Justice K.G. Balakrishnan looked into reservations for Dalits who converted to religions other than Buddhism and Sikhism.
• Reservation in Private Sector: Demands for Reservation in Private sector is gaining popularity amongst the political circle
  • Example: Dalit MP CHandrashekhar Azad introduced A Private Members Bill to enable  Reservation in Private Sector in the Parliament.

Check Out UPSC CSE Books From PW Store

Way Forward

• Detailed Scrutiny:  To plug the loopholes in the issue of NCL, EWS and disability certificates with thorough scrutiny in the issuance of these certificates and detailed background check.
• To fill the backlog vacancies for reserved communities on a mission mode 
• Sub-categorisation of reservation to address the under representation or non-representation of various communities. 
• Creamy layer exclusion in SC and ST category should be Introduced  at least for children of Group I/Class A government officials.

DOWNLOAD PDF

India has successfully prevented the inclusion of Aquilaria malaccensis (agarwood) in the Review of Significant Trade (RST) of Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES).

Agarwood (Aquilaria malaccensis)

• About: Agarwood is a fragrant, dark, and resinous wood derived from the heartwood of Aquilaria trees. 
  • It is one of the most cultivated species in Northeast India and is also grown in other parts of the country. A recent study estimates that there are not less than 139.89 million (13.989 crores) plants in India.
• Formation of Agarwood:
  • Infection Process: Under natural conditions, the agarwood is formed due to fungus-host interaction.
    • Agarwood forms in the heartwood of Aquilaria trees after infection with Phaeoacremonium mold.
  • Defense Mechanism: The tree secretes resin in response to the fungal infestation.
  • Changes in Heartwood: Initially light-coloured and scentless, the heartwood becomes dense, dark, and resin-saturated as the infection progresses.
• Vulnerability to Fungal Infection: 
  • Typical Vulnerability: Usually, plants above the age of seven years are vulnerable to infection by the fungus. 
  • Early Infection Cases: However, the initiation of natural infection is observed in several plants with an age of less than two years in certain parts of Assam, Manipur, and Tripura.
• Artificial Induction of Agar Production
  • Methods: Agar production can be induced artificially using physical, chemical, and biological methods or combinations.
  • Ideal Age for Inoculation: The ideal age for artificial inoculation is six to eight years.
  • Practice: This practice is common in all agarwood-cultivation states where the natural infection rate is low or absent.
• Uses: Agarwood is highly valued and is used in:
  • Incense: Numerous applications such as in the aroma industry and burned for its aromatic fragrance;  preparations of air fresheners and purifiers.
  • Perfumes: Adds a distinctive note to perfumes and colognes. The extracts (agarwood oil) of plants are also used in water-based perfumes. 
  • Medicine: The essential oil extracted from agarwood has anti-inflammatory, anti-rheumatic, analgesic, and antioxidant properties. 
    • It is also used in traditional medicine for its potential health benefits.
• Cost: Agarwood is one of the most expensive woods globally.
• Historical Context of Agarwood Listing: The wild resource of agarwood has become relatively rare due to overharvesting. 
  • Since 1995, the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) has listed Aquilaria malaccensis (the primary source) as a potentially threatened species in Appendix II of CITES based on India’s proposal at CoP9 in 1994.

Enroll now for UPSC Online Course

Recent Developments

• Successful Prevention of Agarwood Inclusion in RST of CITES: India has successfully prevented the inclusion of Aquilaria malaccensis (agarwood) in the Review of Significant Trade (RST) of CITES.
  • The removal of India from the RST for Aquilaria malaccensis was achieved based on a non-detriment findings (NDFs) study of the plant species by the Botanical Survey of India (BSI), Ministry of Environment Forest and Climate Change (MoEFCC).
• New Export Quota Announced: The Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) has announced a new export quota for the highly valuable and aromatic resinous wood and oil of Aquilaria malaccensis (agarwood) from India, effective April 2024.
  • The export quota recommended by the Non-Detriment Findings (NDF) for 2024–2027 
    • Agarwood Chips and Powder/Sawdust: 1,51,080 kg/year
    • Agarwood Oil: 7,050 kg/year

Key points of the Non-Detriment Findings (NDF) report of Ministry of Environment Forest and Climate Change (MoEFCC)

• Prohibited Harvesting: Harvesting of plants or collection of seeds/seedlings/saplings and other propagules should not be allowed from existing wild populations, protected areas, and reserve forests.
• Permitted Harvesting: Harvesting should be allowed from home/community gardens, plantations on leased/patta lands, private or community plantations, or any other types of small-scale/large-scale plantations.
• Absence of Export Quota for a long time: The absence of an export quota for a long period and other trade-related restrictions in India caused an increase in informal trade/export of agar chips, oil, powder etc. to the Middle East and other foreign countries. 
  • It also caused an increase in costs of agarwood chips and oil in the global market as India is a major agarwood trading nation with which most importing countries have long trade records.
  • Over 1.25 tonnes of chips and 6 litres of oil/derivatives were seized in six states of India between 2017 and 2021, according to a TRAFFIC report.
    • The TRAFFIC, the Wildlife Trade Monitoring Network, is a leading non-governmental organisation working on wildlife trade. It is a joint program of the World Wildlife Fund (WWF) and the International Union for Conservation of Nature (IUCN).
• Challenges for Legal Trade Post Export Quota Establishment
  • Legal Trade Difficulties: Although an export quota was established in November 2021, legal restrictions prevented growers and farmers from trading agarwood legally.
  • Shift to Informal Trade: These legal restrictions led growers and farmers towards informal trading channels.

Economic Benefits for Farmers due to removal of Agarwood from the CITES

• Cultivation and Impact: Agarwood is cultivated in various parts of India, particularly in the northeastern states. The development will benefit lakhs of farmers in specific districts of Assam, Manipur, Nagaland, and Tripura.
• Sustainable Trade: With Agarwood no longer in the RST, there’s more flexibility in trade regulations. This could allow for sustainable trade practices that benefit local communities while ensuring conservation.

Check Out UPSC NCERT Textbooks From PW Store

DOWNLOAD PDF

Recently, the Ministry of Culture has initiated the National Mission on Cultural Mapping (NMCM). 

• The database is available at Mera Gaon Meri Dharohar Web Portal which is an open access portal.

About Cultural Mapping Of Villages Or National Mission on Cultural Mapping (NMCM)

Cultural mapping provides “an integrated picture of the cultural character, significance, and workings of a place” in order to help communities recognise, celebrate, and support cultural diversity for economic, social and regional development.

• Aim: The project aims to cover all the inhabited villages of India which is marked as ‘village’, in the Census List, 2011 published by the Registrar General and Census Commissioner of India, including all the inhabited villages of Bihar:
• Awareness: To create awareness about the strengths of cultural heritage and its interface with development and cultural identity.
• Mapping: Cultural Mapping of 6.5 Lakh villages along with their geographical, demographic profiles, and creative capitals.
• Create National Registers: Creation of National Registers of Artists and Art practices.
• Digital Place: Development of a web portal and mobile app to function as a National Cultural Work Place (NCWP).

Enroll now for UPSC Online Course

About Mera Gaon Meri Dharohar (MGMD)

MGMD is a pan-India initiative of the Ministry of Culture under the National Mission on Cultural Mapping and was launched in July 2023. 

• Objective: The main objective of the project is to culturally map India’s 6.5 lakh villages, spanning 29 States and 7 Union Territories, on a comprehensive virtual platform. 
• Opportunity: Through MGMD, people will get an opportunity to immerse themselves in the diverse and vibrant cultural heritage of India. 
• Core Idea: To encourage appreciation for India’s culture and traditions, paving the way for economic growth, social harmony, and artistic development in rural communities.
• Collection of Information: Under the MGMD, information is collected under seven broad categories as given below:
  • Arts and Crafts Village
  • Ecologically Oriented Village
  • Scholastic Village linked with Textual and Scriptural Traditions of India
  • Epic Village linked with Ramayana, Mahabharata and/or Puranic legends and oral epics
  • Historical Village linked with Local and National History
  • Architectural Heritage Village
  • Any other characteristic that may need highlighting such as fishing village, horticulture village, shepherding village etc.
• MGMD Portal: This comprehensive portal showcases essential information about each village, including its geographical location, demographic aspects, and description of traditional dresses, ornaments, arts and crafts, temples, fairs, festivals, and much more. 
  • One-Stop Destination: It serves as a one-stop destination for discovering, exploring, researching, and virtually visiting every village in the country. 
  • Opportunity for Incentives: Users have the opportunity to earn incentives and takeaways as they embark on their digital village journeys.

Check Out UPSC CSE Books From PW Store

DOWNLOAD PDF

The Reserve Bank of India (RBI) has introduced a Prompt Corrective Action (PCA) framework to improve the condition of weak Urban Cooperative Banks (UCBs). 

Reasons for replacing Supervisory Action Framework (SAF)

• More Flexibility: The PCA framework allows for more tailored actions based on the specific problems of each bank, unlike the SAF which had a one-size-fits-all approach.
• Focus on Larger Banks: The new system will pay more attention to larger UCBs, which need closer supervision.
• Simpler System: The PCA framework is less complicated than the SAF, making it easier to understand and implement.
• Alignment with Other Banks: The PCA framework is similar to the systems used for regular commercial banks and other financial institutions, creating a more consistent approach.
• Effective Monitoring: The RBI believes the PCA framework will help identify problem banks sooner and take quicker action to fix them.

Enroll now for UPSC Online Course

About PCA Framework

PCA stands for Prompt corrective action. It is a system imposed by the RBI on banks in case of financial stress. This framework will replace the existing Supervisory Action Framework (SAF).

• It will be effective from April 1, 2025.

Key Features of the PCA Framework

• Applicability: The PCA framework is for UCBs with deposits above Rs 100 crore.
• Categorization of UCBs:
  • Tier 1: UCBs with deposits up to Rs 100 crore.
  • Tier 2: UCBs with deposits above Rs 100 crore and less than Rs 1,000 crore.
  • Tier 3: UCBs with deposits above Rs 1,000 crore and less than Rs 10,000 crore.
  • Tier 4: UCBs with deposits above Rs 10,000 crore.
• Exclusion of Tier 1 UCBs: Tier 1 UCBs are not included in the PCA framework but will continue to be closely monitored.

Check Out UPSC CSE Books From PW Store

Norms for Invoking the PCA Framework

The RBI will put a UCB under the PCA framework if it meets any of the following conditions:

• Low Capital: The bank’s capital adequacy ratio (CAR) is up to 250 basis points below the required level.
• High Bad Loans: The bank has a high percentage of bad loans (non-performing assets or NPAs) between 6% and 9%.
• Consecutive Losses: The bank has incurred losses for two years in a row.
• Breach of Risk Thresholds: Any breach of these risk thresholds may result in PCA invocation.

What Happens When RBI Puts a Bank under PCA?

When RBI puts a bank under PCA, it imposes restrictions and offers guidelines to help improve the overall financial health of the bank. 

• Mandatory Restrictions: 
  • Branch Expansion: The Bank cannot open new branches. 
  • Dividend payment: It is restricted from paying dividend to its shareholders. 
  • Remuneration of Director: Limits are imposed on how much remuneration to be paid to directors. 
• Discretionary  Actions by RBI 
  • Business model review: The bank’s board can be asked to review and reassess their business model and operations to ensure profitability of the business. 
  • Plans and Strategy of Business: The RBI may advise banks to replan and re-evaluate its strategies for making changes in the management. 
  • Resolution plan: The bank board will have to create a resolution plan subject to RBI approval to address financial issues. 
  • Hiring Restrictions: Banks might face restrictions in hiring new employees.
  • Capital expenditure: The banks would be confined to  spend money on upgradation of technology within pre-approved limits. 

Monitoring and Implementation

• Supervisory Focus: The framework focuses more on larger UCBs needing intensive monitoring.
• Annual Financial Results: Banks will be placed under PCA based on reported and audited annual financial results and ongoing supervisory assessments.
• Flexibility: The framework allows for tailored supervisory action plans based on specific risks for each entity.
• Capital Expenditure Restrictions: The previous hard limit of Rs 25,000 on capital expenditure under SAF is removed, allowing supervisors to set limits based on their assessment.

Benefits of the New Framework for Urban Cooperative Banks

• Stronger Oversight of Larger Banks

  • Focused Attention: The framework targets larger UCBs (Tier 2, 3, and 4) with significant deposits.
  • Better Resource Allocation: The RBI can efficiently use its supervisory resources by focusing on higher-risk banks.

• Early Warning System

  • Proactive Action: The framework detects banks with potential issues early by monitoring financial health indicators like capital, bad loans, and profits.
  • Preventive Measures: Early detection allows the RBI to intervene and improve the bank’s condition before problems escalate.

• Flexible Approach

  • Tailored Solutions: The RBI can design specific improvement plans for each bank based on its unique challenges.
  • Reduced Rigid Rules: The new framework offers the RBI more flexibility in deciding how to assist struggling banks compared to the old system.

Check Out UPSC NCERT Textbooks From PW Store

• Improved Bank Health

  • Stronger Capital Position: Banks are encouraged to maintain better capital levels to avoid falling under the framework.
  • Reduced Bad Loans: Emphasis on reducing bad loans will encourage banks to recover overdue loans and lend more responsibly.
  • Profitability: Banks will strive to become profitable to avoid being flagged under the framework.

The new framework aims to strengthen the banking system by identifying and addressing issues in urban cooperative banks early on, ensuring the safety of depositors’ money.

Challenges of the PCA Framework for Urban Cooperative Banks (UCBs)

• Identifying Weak UCBs

  • Subjective Criteria: Determining which banks are “weak” based on capital adequacy, bad loans (NPAs), and consecutive losses can be subjective and might not capture all risks.
  • Delayed Response: Triggering PCA after two consecutive years of losses could result in delayed intervention.

• Implementation Issues

  • Supervisory Resources: Effective implementation of PCA requires sufficient supervisory resources, which might be challenging, especially for smaller UCBs.
  • Data Accuracy: Reliable and timely financial data is essential for assessing bank health, and data quality issues in UCBs could hinder effective PCA application.
  • Flexibility: While the framework allows for case-by-case assessments, it might still be too rigid in some situations, limiting tailored interventions.

• Impact on UCBs

  • Reputation Damage: Being placed under PCA can harm a bank’s reputation and reduce customer confidence.
  • Business Limitations: Restrictions on capital expenditure and other limits under PCA can impede a bank’s growth and development.
  • Exit Difficulty: The stringent criteria for exiting PCA might make it hard for banks to recover and improve.

• Overall Effectiveness

• • Focus on Larger UCBs: Although the framework prioritizes larger UCBs, it is crucial to ensure that smaller UCBs with potential risks are not neglected.

Enroll now for UPSC Online Classes

DOWNLOAD PDF

Recently, President Droupadi Murmu appointed Governors for Rajasthan, Telangana, Maharashtra, Punjab, Sikkim, Meghalaya, Assam, Jharkhand and Chhattisgarh 

Appointment and Role of Governors in Indian States

• Article 153 of the Indian Constitution: It says “There shall be a Governor for each State.” 
  • Appointment for two or more states: An amendment in 1956 laid down that “nothing in this article shall prevent the appointment of the same person as Governor for two or more States” 
• Method of appointment: He is neither elected directly by the people nor indirectly elected by a specially constituted electoral college.
  • According to Article 155, He is the central nominee, appointed by the President by warrant under his seal.
• Canadian Model: The governor of a province (state) is appointed by the Governor-General (Centre).
  • India adopted the Canadian Model of appointment of Governor by the center.
• Origins in GOI Act 1935: The Institution of Governor borrowed from GOI Act 1935.
• 7th CAA (1956): Facilitated the appointment of the same person as a governor for two or more states.
• Supreme Court (Hargovind Pant Case, 1979): Office of the governor of a state is not an employment under the Central government. 
  • It is an Independent constitutional office, not under the control of or subordinate nor an employment under the Central government.
• Draft Constitution: Provided for the direct election of the governor on the basis of universal adult suffrage.
• Limitations on Governor’s Powers: Governor has no diplomatic, military or emergency powers like the president.

Enroll now for UPSC Online Course

Qualifications and Conditions of Office for Governors in Indian States

• Constitutional Provisions: Articles 157 and 158 lay down the qualifications of the Governor and the conditions of his office.
  • Citizen of India.
  • Completed 35 years of age.
• Two  Conventions:
  • Preferably an ‘Outsider’ and should not belong to the state where he is appointed.
  • While appointing the governor, the president is required to consult the CM of the state concerned.
    • However, both the conventions have been violated in some of the cases.
• Oath (Article 159): Oath administered by the Chief Justice of HC of the concerned state and in his absence, the senior-most judge of that court.
• Condition of Office: Not a member of either house and not hold any other office of profit.
• Emoluments, Allowances and Privileges
  • Determined by Parliament.
  • Cannot be diminished during his term of office. 
  • Immune from criminal proceedings (even if personal) 
  • Cannot be arrested or imprisoned.
  • 2 Month’s notice in civil proceedings during term of office in respect of his personal acts.
  • When appointed as Governor of two or more states, allowances shared by the states in such proportion as determined by the president.
  • Enjoys personal immunity from legal liability for his official acts.

Governor’s Term and Contingency Provisions in Indian States

• Term: Under Article 156 says that the Governor shall hold office during the pleasure of the President. But his normal term of office will be five years.
  • Surya Narain Case (1981): Pleasure of the President is not justifiable. 
    • So, no security of tenure and no fixed term of Office.
• Central government Role : President acts on the aid and advice of the Prime Minister and the Union Council of Ministers, in effect, the Governor is appointed and removed by the central government.
• Resignation: To President.
• Transfer: The President may transfer a Governor appointed to one state to another state for the rest of the term.
• Reappointed: Maybe in the same state or any other state.
• Hold office beyond his term until his successor assumes charge to prevent ‘Interregnum’
• Contingency Provision: The President can make such provision as he thinks fit for the discharge of the functions of the governor in any contingency not provided for in the Constitution.
• Removal: The Constitution does not lay down any grounds upon which a governor may be removed by the President. 

Powers and Functions of Governors in Indian States

• Veto Power
  • For ordinary bills, the governor has four alternatives:
    • He may give his assent to the bill.
    • He may withhold his assent to the bill, the bill then ends.
    • He may return a bill for reconsideration of the Houses. 
      • If the bill is passed by both Houses again with or without amendments and presented to the governor for his assent, the governor must give his assent to the bill. the governor enjoys only a ‘suspensive veto’.
    • He may reserve the bill for the consideration of the President.
  • Governor can also reserve a bill if it is: 
    • Endangers the position of the state high court; 
    • Against provisions of the Constitution; 
    • Opposed to the DPSP; Against the larger interest of the country, and of grave national importance; Compulsory acquisition of property.
  • When the governor reserves a money bill for the consideration of the President, he will not have any further role in the enactment of the bill. 
    • The President may give his assent or may withhold his assent but he can not return the state money bill.
    • If the President gives his assent to the bill, it becomes an Act. This means that the assent of the governor is no longer required.
• Legislative Powers
  • Governor is an integral part of the State legislature.
  • Summons, prorogues, and dissolves the State Legislative Assembly.
  • Address the state legislature at the commencement of the first session after each general election and the first session of each year.  
  • Send messages to the house or houses of the state legislature, with respect to a bill pending in the legislature or otherwise.
  • Appoint any member of the State legislative assembly/council to preside over its proceedings when the offices of both the Speaker/chairman and the Deputy Speaker/deputy chairman  fall vacant. 
    • Similarly, he can appoint any member of the state legislature council to preside over its proceedings,  when the offices of both Chairman and Deputy Chairman fall vacant.
  • Nominates: 1/6 members in the State Council.
  • Decides on the question of disqualification of members of the state legislature in consultation with the Election Commission.
  • Lays the reports of State Finance Commission, SPSC and CAG before the state legislature. 
  • Promulgate ordinances when the state legislature is not in session (must be approved by the state legislature within six weeks from its reassembly).

Check Out UPSC CSE Books From PW Store

• Judicial Powers
  • Judges of High Court: Consulted by the president while appointments of judges of HC.
  • District Judges: Makes appointments, postings and promotions of the district judges in consultation with the state high court.
  • Others: Appoint persons to the judicial service of the state other than the district judge in consultation with the state high court and the SPSC.
  • Pardoning Powers: He/she can grant pardons, reprieves, respites and remissions of punishment or suspend, remit and commute the sentence of any person convicted of any offense against any law relating to a matter to which the executive power of the state extends.
• Governor’s Discretionary Power
  • According to the Constitution, if there is any doubt about whether a matter falls within the governor’s discretion, the governor’s decision is final and cannot be challenged based on whether they should or should not have exercised their discretion.
  • Constitutional Discretion
    • Reservation of Bills for the President’s consideration. 
    • Recommendations for President’s Rule.
    • Administration of adjoining UT.
    • Seeking information from the Chief Minister regarding administrative and legislative policies.
    • Determining the amount payable by the Govt of Assam, Meghalaya, Tripura and Mizoram to an autonomous Tribal District Council (6th scheduled areas) as royalty accruing from licenses for mineral exploration.
  • Situational Discretion
    • Appointment of the Chief Minister when no party has a clear-cut majority in the state legislative assembly or when the chief minister in office dies suddenly, and there is no obvious successor.
    • Dismissal of the council of ministers when it cannot prove the confidence of the state legislative assembly.
    • Dissolution of the state legislative assembly if the council of ministers has lost its majority.

Issues Related To Governor

• Arbitrary removal: The arbitrary removal of the Governor before the expiration of his tenure has also been an important issue in the recent past.
• Rehabilitative appointments: The position has been reduced to becoming a retirement package for politicians for being politically faithful to the government of the day.
• Abuse of position: There are various examples of the Governor’s position being abused, usually by the ruling party at the Centre.
• Misuse of discretionary powers: Governor’s discretionary powers to invite the leader of the largest party /alliance to form the government has often been misused.
• Partisanship Role: Recently, the Governor of Rajasthan has been charged with the violation of the model code of conduct. His support of the ruling party is against the spirit of non-partisanship that is expected from the person sitting on constitutional posts.
• Misuse of power under Art. 356: The imposition of President’s rule (Art.356) in case of breakdown of constitutional machinery in a State has been frequently misused by the central government.
• Mere rubber stamp or puppet: Governor is bound by the aid and advice of his council of ministers.

Recommendations Of Sarkaria Commission

• Related to Article 356:
  • Art. 356 should be used in very rare cases when it becomes unavoidable to restore the breakdown of constitutional machinery in the State. It should be used as a matter of last resort.
  • Before taking action under Art. 356, a warning should be issued to the state government that it is not functioning according to the constitution.
• Related to Governor:
  • Governors should be appointed in consultation with the Chief Minister of the State, Vice-President of India and the Speaker of the Lok Sabha.
  • His tenure of office must be guaranteed and should not be disturbed except for extremely compelling reasons.
  • Criteria for selection of Governor:
    • He should be eminent in some walk of life. 
    • He should be a person from outside the State.
    • He should be a detached figure and not too intimately connected with the local politics of the State. 
    • He should be a person who has not taken too great a part in politics generally and particularly in the recent

Enroll now for UPSC Online Classes

• Related to appointment of CM:
  • If there is a single party having an absolute majority in the Assembly, the leader of the party should automatically be asked to become the Chief Minister.
  • In the absence of such a party, the Governor shall choose a CM by holding hearings with each of the following parties or groups of parties in the order of preference listed below:
    • An alliance of parties that was formed prior to the Elections.
    • The Largest Single Party staking a claim to form the government with the support of others, including independents.
    • A post-electoral coalition with all partners joining the government.
    • A post-electoral alliance with some parties joining the government and the remaining supporting from outside
• Others:
  • When the President withholds his assent to the state bills, the reasons should be communicated to the state government.
  • The procedure of consulting the chief minister in the appointment of the state governor should be prescribed in the Constitution itself.
  • The Governor cannot dismiss the council of ministers so long as it commands a majority in the assembly

DOWNLOAD PDF

Recently, India hosted the 2nd BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation) Foreign Ministers’ Retreat.

• It focused on providing an “informal platform to discuss ways and means of cooperating and accelerating action in security, connectivity, trade, and investment within the Bay of Bengal.

Crucial Insights on the Recent Retreat

The retreat was held in preparation for the sixth summit meeting, scheduled for September, in which the BIMSTEC leaders will meet in person for the first time in the post-pandemic era. 

• They are also expected to sign the BIMSTEC Agreement on Maritime Transport Cooperation to improve regional connectivity, a foundational aim of this grouping.
• About Parts of the Retreat: The retreat was divided into following two parts:

Enroll now for UPSC Online Course

About BIMSTEC

BIMSTEC is a regional organisation of seven Member States lying in the littoral and adjacent areas of the Bay of Bengal, cooperating across seven diverse sectors. 

• Formation: It was founded as BIST-EC, in June 1997, with the adoption of the Bangkok Declaration, with Bangladesh, India, Sri Lanka and Thailand as members. 
  • It became BIMST-EC (Bangladesh, India, Myanmar, Sri Lanka and Thailand Economic Cooperation) with the entry of Myanmar in late 1997. And eventually, it was named in its current form, when Nepal and Bhutan became members in 2004.
• Secretariat: Dhaka, Bangladesh
• Membership: It has a total of seven member countries:
  • Five from South Asia, including Bangladesh, Bhutan, India, Nepal, and Sri Lanka
  • Two from Southeast Asia, including Myanmar and Thailand
• Founding Principles: Principle of Sovereign Equality, Territorial Integrity, Political Independence, Non-interference in Internal Affairs and Peaceful Coexistence and Mutual Benefit.
• Aim: BIMSTEC aims to counter the onslaught of globalisation by accelerating regional growth through mutual cooperation by utilising regional resources and geographical advantages.
  • It was not about creating a new region for cooperation but to revive the connectivity and common interests of the members of the Bay of Bengal region.
    • The Bay of Bengal region was one of the world’s most integrated regions until the early twentieth century, but after the 1940s, when members of the region became independent and pursued separate goals and alliance systems, “the region’s sense of community has almost completely eroded”.
• Distinctive Features of BIMSTEC: 
  • Division of Responsibilities: Goals and areas of cooperation are divided among member states.
    • Example: India has previously been responsible for sectors such as transportation, tourism, and counter-terrorism within BIMSTEC.
  • Sector-Driven Organisation: Unlike many other regional groupings, BIMSTEC is a sector-driven cooperative organisation. Six areas of focus under BIMSTEC are —trade, technology, energy, transport, tourism and fisheries. 
  • Priority Areas: BIMSTEC has identified 14 priority areas: Trade & Investment, Transport & Communication, Energy, Tourism, Technology, Fisheries, Agriculture, Public Health, Poverty Alleviation, Counter-Terrorism & Transnational Crime, Environment & Disaster Management, People-to-People Contact, Cultural Cooperation. 
    • ‘Climate Change’ was added as the 14th priority area of cooperation in 2008. 
    • Among these priority areas, a member country chooses which of the 14 priority areas it is willing to take lead.
      • India is the lead country for Transport & Communication, Tourism, Environment & Disaster Management and Counter-Terrorism & Transnational Crime.

Check Out UPSC CSE Books From PW Store

• Working Mechanism of BIMSTEC:

  • Under BIMSTEC, Policy making would be done through two types of meetings: 
    • Summits, which are supposed to be held every two years.
    • Ministerial meetings of Foreign and Commerce Ministers of member countries for deciding on trade and economic affairs, to be held once every year. 
  • An operational meeting of senior officials to monitor the activities of the grouping is also supposed to be held twice a year.
  • BIMSTEC Working Group: BIMSTEC has a coordinating body called the BIMSTEC Working Group, which has a rotating chairman based on which member country chairs the organisation. 
    • Under this, meetings are to be held monthly at the Dhaka secretariat to review the progress of the regional grouping.
  • Business Forum & Economic Forum: It ensures active participation of the private sector.

Significance of BIMSTEC

The group has a combined population of 1.8 billion, or about 22% of the global population and its combined GDP was $4.5 trillion as of 2022, which was about 4.4% of world GDP, per World Bank data. As per UNCTAD, the states had a combined external trade of $1.95 trillion, or about 6% of world trade.

• Bridge between South and South-East Asia: The regional group constitutes a bridge between South and South East Asia and represents a reinforcement of relations among these countries.
• Aligns With India’s Vision: BIMSTEC represents the intersection of
  • India’s ‘Neighbourhood First’ outlook, the ‘Act East Policy’, and the SAGAR (Security And Growth for All in the Region) vision.
• Security Cooperation: Shared security challenges such as terrorism and piracy necessitate cooperation among member states.
  • India plays a key role in fostering security cooperation through joint exercises, intelligence sharing, and capacity-building initiatives.
• Trade Potential: BIMSTEC is important owing to the land and maritime trade potential of the member countries. There is potential for a Free Trade Agreement within BIMSTEC.
• Disaster Management and Climate Change: The Bay of Bengal region is highly vulnerable to natural disasters and climate change impacts. BIMSTEC offers a framework for regional cooperation in disaster management and climate change mitigation.
  • India can lead efforts to enhance regional preparedness and resilience.
• Countering China: BIMSTEC could allow India to push a constructive agenda to counter Chinese investments, and instead follow best practices for connectivity projects based on recognised international norms. 
  • China has undertaken a massive drive to finance and build infrastructure in South and Southeast Asia through the Belt and Road Initiative in almost all BIMSTEC countries except Bhutan and India. The Chinese projects are widely seen as violating these norms.
• Others: 
  • Connectivity: Enhancing regional connectivity is its key focus and projects like the Kaladan Multi-Modal Transit Transport Project aim to improve connectivity. Improved connectivity will further boost trade, tourism, and people-to-people exchanges.
    • Other examples of connectivity are ASIAN Trilateral Highway, BBIN motor vehicle agreement, etc.
  • Energy Cooperation: BIMSTEC also provides a platform for regional energy cooperation as the Bay of Bengal region is rich in natural resources.
    • Initiatives like the BIMSTEC Energy Centre and a regional energy grid contribute to energy security and sustainability.
  • Multilateral Engagement: It allows India to engage multilaterally with the other countries of the Bay of Bengal region, which are its eastern neighbours and therefore vital for its economic development, security, and foreign policy imperatives. 
    • India also remains intent on solidifying relations with its eastern neighbours as China’s growing presence in the Bay of Bengal poses a potential threat to regional stability and India’s position as a preferred security partner.

Challenges with BIMSTEC

Following challenges have been faced by BIMSTEC that need to be tackled:

• Sluggish Pace: Lack of efficiency and “sluggish” pace of BIMSTEC’s progress. 
  • The inconsistency in holding policy making and operational meetings is also a concern. 
  • The focus of BIMSTEC is very wide, including 14 areas of cooperation like connectivity, public health, agriculture. It is suggested that BIMSTEC should remain committed to small focus areas and cooperate in them efficiently.
• Financial and Human Resources Crunch: BIMSTEC secretariat also suffers from inadequate financial and manpower assistance for its operational activities.
  • Initiatives had been undertaken for the creation of a BIMSTEC Development Fund intended to ease the planning, and implementation of projects and programmes under the various cooperation areas, it is yet to be implemented.
  • BIMSTEC has a limited budget (approximately US$ 200,000) and delayed implementation of the Development Fund.
• Absence of Connected Coastal Ecosystem: BIMSTEC members are yet to build a shared and lucrative coastal shipment ecosystem and also grapple with frequent detention of fishermen who cross territorial borders.
• China Factor: The formation of another sub-regional initiative beside China’s ambitious Belt and Road Initiative, the Bangladesh-China-India-Myanmar (BCIM) Forum, with the proactive membership of China, has created more doubts about the exclusive potential of BIMSTEC.
• Trade Challenges: India’s percentage of annual trade with BIMSTEC countries as a percentage of its total foreign trade was in the double digits in the 1950s, but was just 4% as of 2020. 
  • It was also seen that a lot of the time, BIMSTEC member countries do not import goods that are manufactured and exported by other members, instead importing from other non-member countries.
  • BIMSTEC members have not adopted a Free Trade Agreement yet, they are involved in multiple bilateral and multilateral free trade, preferential trade and economic cooperation agreements with other countries.
• Others: BIMSTEC countries today face high anti-globalisation measures, the Russia – Ukraine war and new threats, disruption of supply chains, unavailability of emerging and critical technologies, climate change and environmental issues and  maritime security issues. 
  • Bilateral Issues between Member Nations: Bangladesh is facing one of the worst refugee crises of Rohingyas from Myanmar who are fleeing persecution in the state of Rakhine in Myanmar. There is a border conflict between Myanmar and Thailand.
    • India and Nepal have border disputes over Kalapani – Limpiyadhura – Lipulekh trijunction between India-Nepal and China and Susta area, West Champaran district, Bihar.

Check Out UPSC NCERT Textbooks From PW Store

Way Forward

Regional integration is no longer an option but an essential part of a national policy in this age of shared challenges such as trade protectionism, war, climate issues, and energy security, among others. Also, BIMSTEC can draw lessons from ASEAN’s success in multilateral cooperation.

• Trade: It is high time that instead of completing other pillars, BIMSTEC countries implement the goods component of the FTA which has been negotiated already.
  • BIMSTEC countries need to re-work for simplification and harmonisation of customs procedures, technical regulations, standards, and SPS measures, in administrative fees and charges, transparency of laws, regulations, and administrative rulings, risk management systems, and digitalization in trade procedures.
• Faster Mobility: BIMSTEC countries may negotiate a BIMSTEC Railway Agreement. Along with it, a regional air transportation agreement in cargo and passenger services will lead to promoting faster mobility of goods and services like tourism, health, and education.
• Attention on Exchange of Energy: The region is going to face many new challenges in the next 25 years including those that are related to climate and biodiversity. BIMSTEC countries should work together on emission reduction, energy efficiency, and renewable energy targets.
• Digital Connectivity: India’s United Payments Interface could be a great lead for other BIMSTEC countries. Digital connectivity is a new hope for BIMSTEC.
• Common Transit System: BIMSTEC Customs Transit System (BCTS) may offer strong catalytic power not only to facilitate trade among BIMSTEC but also to improve the region’s competitiveness. 
  • BCTS may help BIMSTEC countries with a single vehicle, a single transit, a single bank guarantee, and a single Customs declaration.
  • Bay of Bengal countries also need development partners like Japan who can provide investment, technology, and infrastructure.
• Roadmap for Capacity Building: The BIMSTEC Secretariat has been entrusted to come out with Plans of Action for the region in view of the reorganisation of priority areas of cooperation. With increased resources, there is now a need to develop a roadmap for capacity building of the BIMSTEC Secretariat.
  • The Secretariat needs to be adequately resourced and has sufficient delegated powers to fulfil its role as a coordinator of activities across BIMSTEC members. 
• Others: 
  • Develop Connectivity Projects: The Indian government should expedite the implementation of connectivity projects, such as the India-Myanmar-Thailand trilateral highway, to facilitate trade and movement. This will not only enhance economic ties but also improve regional stability.
  • Deepening Cooperation: BIMSTEC member countries should focus on deepening cooperation in various sectors such as trade, technology, energy, transport, tourism, fisheries, security, counterterrorism, disaster management, and energy.
  • Dispute Resolution: BIMSTEC can formulate a dispute-resolution mechanism, which operates on the principles of deliberation and consensus.

Conclusion

This year marks a decade of India’s Act East and Neighbourhood First policies, and the thrust on BIMSTEC is a manifestation of India’s efforts to continue nurturing collaborative growth for national and regional well-being.

Enroll now for UPSC Online Classes

DOWNLOAD PDF